Monday, September 18, 2017

In Lambert v. Neutraceutical Corp., ___ F.3d ___ (9th Cir. Sept. 14, 2017), the Ninth Circuit considered a UCL, FAL and CLRA action against the manufacturer of an "aphrodisiac dietary supplement." Slip op. at 5. The complaint alleged that the defendant sold the product in violation of certain FDA regulations and that the product was falsely labeled. Id.

The district court "initially granted class certification on the basis of the full refund damages model. That model applies when a product is shown to be worthless, and damages may be calculated by multiplying the average retail price by the number of units sold." Id. at 6. Subsequently, the defendant moved to decertify the class, and a different judge granted the motion. Id. Plaintiff moved for reconsideration, which was denied. Id. at 7. Within 14 days thereafter, plaintiff filed a Rule 23(f) petition. Id. at 8.

The Ninth Circuit held that the fourteen-day deadline to file a Rule 23(f) petition is "not jurisdictional, thus equitable exceptions apply." Slip op. at 1. In particular, "a motion for reconsideration filed within the Rule 23(f) deadline will toll the deadline," as will "additional equitable circumstances." Id. at 1, 10. In a lengthy discussion, the Court concluded that the plaintiff's Rule 23(f) petition was timely. Id. at 9-21.

Then, the Court turned to the merits, and held that the district court erred in granting the defendant's motion to decertify the class. Slip op. at 21-25. Variations in damages do not defeat class certification; UCL, FAL, and CLRA damages (or restitution) calculations need not be precise; and the plaintiff's proposed "full refund" damages model was a "workable method" to determine and award damages. See id.